Projecting Flown Revenue


Projecting Flown Revenue

Problem

One of the challenges that Liz, a GM of a major carrier faced, was the ability to forecast her flown revenue in order to manage her performance versus sales targets in a timely manner.

She received regular reports from her head office’s revenue management system but the reports were not timely as they arrived six to eight weeks after the end of the month. This is a common problem in the airline industry, but for Liz it meant she was unsure about how effectively the sales team had performed in real time.

By the time the data was presented it was too late to take any quick tactical pricing or marketing decisions. At the end of each period it was always a bit of guesswork as to whether they would hit or miss their sales targets.  As well as the flown passenger and revenue reports from head office, Liz and the team had been using BSP Billing reports to analyse their ticketed sales using some guesstimates to predict flown revenue.

Solution

The airline subscribed to Airline Metrics. The web application is updated each week and provides both ticketed values and flown revenue projections. As it uses HOT files that are the same data set used by the revenue management team at head office, the projections come in very close to what is subsequently reported from head office. Passenger number projections are also provided.

Outcome

The speed of reporting means that Liz is now able to quickly see the impact of their Early Bird type tactical fare sales. The forward booking reports, once again coming in so much quicker and more frequently, now give a clear and concise picture of how well future months are performing versus expectation.

Liz had the previous 2 years HOT file data loaded to be able to benchmark all performance metrics of this year versus the same for the previous year, and as result can see booking trends and other factors that mean she can make the right decisions at the right time and avoid any nasty revenue or passenger surprises.

Because the dashboards, graphs and reports are presented in such a user-friendly fashion, Liz has to do no data processing work on her side. She and her team simply log in and use the updated data each week.